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8/17/2011 2:51PM

Inflation on the Rise

The government's latest reading of producer prices suggest inflation may be rearing its head at the wholesale level. Phil Izzo looks at whether those cost increases are likely to soon show up at the consumer level.

This transcript has been automatically generated and may not be 100% accurate.

go ... oh ... how did he suggests a call I may be in store for consumers we are bringing out build it so ... right now to bring this break it down for us ... feel ... good and is not so that is actually funding and these these numbers yet what we got the wholesale price switches up are the prices that feeds into itself produces that we pay necessarily ... is the price is that the people who sell stuff going ... on and the numbers were a bit higher this of this more than we were expecting ... um and they were specially Connor considering the fact that energy prices before ... he was in July we saw that the O'Boyle that finally start to put down a little bit ... even outside of oil price outside that will work on are ... a lot of that was in food especially beef and veal ... but even exclude we think we have a mature person over pork prices which exclude the volatile food and energy ... and you know those prices were a bit higher ... so the question in gum started buying this and this is thinking will do well are they not going to pass these costs along to me is the consumer is what are the odds of that that's the big question will go a little bit more tomorrow we get consumer prices which is the prep the prices but everybody pays ... aam but the Xoom duo There's little question about whether they can pass those those prices on that people are worried there are still lot people without jobs ... or Suleiman who are holding back tears their spending ... so they've been wanting to pass on ... me every survey we've seen a chunk of the same over and over again ... we want to pass on higher prices of one or pass on higher prices but ... the demand just isn't there ... so the passing on price means prices get passed on to things like cigarettes was one of the biggest jumps we saw this one was off like ... to twenty percent or to was the result of taxes but ... it's easier to pass on prices are up in all product that people are addicted to ... it what does this leave the Federal Reserve in terms of what it can do I get to ease credit ... well that's one of the concerns about this for people were hoping for another round of easing from the Fed ... is that ... they're not the same position they were election ... last year you know we were seeing a ... fall in prices were flat out ... inflationary fears ... this year is a totally different story ... so it's a lot harder for the Fed to jump in and do another round of either online or World larger scale program because they happen ... however the back of their mind ... that these prices to be home runs and you think of things Jesus come back to consumer permitted to other sectors been a need to be most worried about ... outside obviously gas average ... folks on to it that is it in the food sector mean is that for most homeowners that is that with that the pain Semicon that's that's really where the concern is the Sonos Food prices unlikely said those are always volatile prices ... but ... that's where it really hits the consumer pockets of the most of those type of things that you can afford ... not to buy ... what you have to go well vice who knew how to fill because ... it's easier to pour off a purchase of a new shirt or both of you know ... that the purchase of a car somewhere that if you can ... but it's what a lot harder with a ... Wall Street doesn't seem that were attending this and the markets and adopted a say these numbers have nots with a ... damper on that well I guess they're sort of winter those consumer numbers that give us a bit more sense of where the Fed's stance ... because like I said that the Fed does this really focus on the wholesale numbers because of all depends on whether it gets passed on to the consumer ... to teach him some of the consumer they knew not to see that widespread inflation that we really be concerned about interest in art tell we would continue to watch these numbers the city's name is consumer spending our isn't coming out tomorrow I will get the RACV on talking to you about that thanks for the year